At the end of 2009 UK businesses had significantly improved the time it takes them to settle their bills.
According to the latest Late Payment Index from Experian, during December last year businesses were paying their late bills an average of 20.88 days after agreed terms – an improvement of over two and a half days from 23.54 days in December 2008.
The biggest improvement in payment performance came from the largest businesses, with 500 or more employees, which showed a reduction from 36.10 days late in January 2009 to 28.97 days by December.
However, compared to 2008, last year’s overall payment performance was marginally worse, declining from 21.51 days after agreed terms in 2008 to 22.79 days in 2009.
Joe Myers, head of commercial credit at Experian’s Business Information division, said: “The fact that the country’s biggest businesses reduced the time it takes to settle their bills by nearly 20% is a significant turnaround.
“Companies are more aware now than ever that their credit score is affected by their payment behaviour. While this enables them to negotiate improved terms as well as raise credit from alternative sources or suppliers, it also means that other businesses can make more informed decisions about working with them.”